Korea: Amoral society

Korean Air Chairman Cho Yang-ho is spared from a jail stay for alleged tax evasion, embezzlement and breach of trust, among others. Cho and his family are the object of national contempt, causing the nation to be deeply skeptical about chaebol and a system under which they can get away with just about everything. Yonhap

By Oh Young-jin

A society learns from itself.

If it is run by rules, fair to members and just in its conduct, that society would become rules-based, fair and just. If not, it would be unruly, unfair and unjust ― an amoral society.

What about our Korean society?

Korean Air's owner family ― Chairman Cho Yang-ho, his wife and three children ― are allegedly involved in all kinds of misconduct ― tax evasion, embezzlement, mistreatment of employees and breach of trust, among others.

Five years ago, Cho's first daughter, Heather, caused the "nut rage" case ― throwing tantrum at the cabin crew for not having her nuts served on a plate and ordering the taxiing aircraft to return to the gate.

So the Chos have learnt little or too much, depending on how one sees it.

Their lesson is obviously that they are beyond being held accountable for whatever they do. As chaebol, they own their group, can use corporate funds like their money and treat employees as they like.

In return for what they see as these inalienable privileges, all they have to do is endure occasional periods of embarrassment ― being paraded in front of the nation and offering apologies, heads bowed. Perhaps a bit of time behind bars may sometimes be necessary. Then everything will return to the same old situation.

Of course, Korean Air is not alone. At the moment, Asiana Airlines, Korean Air's rival, shows the same mentality of privilege. Asiana has stopped providing in-flight meals, forcing passengers to fly on empty stomachs. One meal contractor killed himself.

Besides allegations of possible corruption in the change of subcontractors, it is a blaring case of managerial incompetence. But the real clincher was Chairman Park Sam-koo's decision to appoint his homemaker daughter as an executive at an affiliated firm.

Lotte Chairman Shin Dong-byn on his way to court. He has been behind bars since winning a long-running battle with his brother for control of the conglomerate Yonhap

At a recent news conference, Park said, "Look at that appointment with generosity."

Chaebol, small or big, are not much different from Asiana or Korean Air. Although Korean Air Chairman Cho has been spared from a long stay in jail, Lotte Chairman Shin Dong-byn has been thrown into jail after winning a long-running battle with his brother for control of the business conglomerate.

There have been numerous cases where chaebol family members using "gapjil" ― bullying employees or forcing be at their beck and call.

The chaebol families' power derives from their control of the groups.

But chaebol-controlled firms are not private ― they are listed public companies. They are owned by shareholders and, in most cases, the so-called owners are not majority shareholders.

Rather, their shareholdings are a fraction of the total, so the chaebol families still see the business empires as their family business and control as their birthright.

It is against the rule of proportionality. They use the affiliated companies as their private belongings and block challenges at shareholder meetings or on stock markets.

The problems that Hyundai Motor and Samsung Group have faced during their structural realignment should stem from their attempt to hand business control to the next generation even if their shareholdings are not big enough.

Part of the reason why they are so vulnerable to vulture funds or foreign shareholder activists is that most of their shareholdings belong to foreign entities or individuals and their "owners' shares" are too small.

In other words, they may be founders of the firms but are not entitled to total ownership. This means their sense of privilege and entitlement ― being above everybody else ― is misplaced.

Their procrastination is producing two consequences.

The first is making other members of society feel that the system is working against rules, unfairly and unjustly.

Second, as a result, it is frustrating and angering people, because they feel powerless. The situation also encourages some people or businesses to imitate chaebol practices on whatever scale they can.

Either way, our society may be heading down the path to moral bankruptcy, turning it into a losing game for all.

Timing is everything. Even a president, another symbol of big power, can be toppled in a collective act to prevent the slide. There should be few exceptions.

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